Cong expresses disappointment over Govt’s financial package, calls MSME relief ‘modest’

New Delhi, (thestates.news) Expressing disappointment over the financial package announced by Prime Minster Narendra Modi and elaborated by Finance Minister Nirmala Sitharaman, Congress on Wednesday said that the package was a ‘cruel blow’ to those who toil every day.
“There is nothing in what Finance Minister said today for the lakhs of poor, hungry and devastated migrant workers, who walked a thousand miles to reach their home states, some were still walking. It is a cruel blow to those who toil every day,” Mr Chidambaram, who was also the former Union Finance Minister, said.
Mr Chidambaram’s response came moments after Ms Sitharaman described the details of the Rs 20 lakh crore package, which was aimed at helping the lockdown-hit economy, announced by Mr Modi, while addressing the nation on May 12.
“There is also nothing by way of cash transfer to the bottom half of the population – 13 crore families, who have been pushed into destitution,” the Congress leader added.
Pointing out at the details provided by Ms Sitharaman, Mr Chidambaram said ‘What did the Finance Minister tell us? There will be a collateral-free loan programme to 45 lakh MSMEs, backed by a Credit Guarantee Fund of Rs three lakh crore and some other measures, including Rs 20,000 crore subordinate debt and Rs 10,000 crore equity fund.’
Referring to the announcements, the former Union Minister said the Finance Minister has announced some support measures for MSMEs.
‘Although my comment is the measures were skewed in favour of the larger MSMEs (about 45 lakh MSMEs). I think the bulk of the 6.3 crore MSMEs were left high and dry,’ he added.
Mr Chidambaram also said that Congress welcomes the offer of subordinate debt (Rs 20,000 crore) and equity corpus fund (Rs 10,000 crore), but will await the ‘terms and conditions’ and added, ‘the devil is in the detail’.
On the credit guarantee fund, he said it was not the entire fund that will be actually spent.
‘The expenditure will be limited to the extent of NPAs in the outstanding guaranteed credit to MSMEs. Assuming an NPA level of 20-50 per cent, the actual expenditure over the period of the loans (which may be years) will be a maximum of Rs 3,00,000 crore,’ he added.
He also questioned the liquidity-related measures announced by Ms Sitharaman and said he would refrain from commenting on liquidity-related measures.
‘Such measures do not amount to fiscal measures of support and nowhere in the world are they included or counted in a fiscal stimulus package.
‘The government has announced Rs 3.6 lakh crore in the Rs 20 lakh crore package. Where is the rest of Rs 16.4 lakh crore? This government is a prisoner of it’s own ignorance and fears. The government must spend more, but it is not willing to do so.
‘The government must borrow more, but it is not willing to do so. The government must allow states to borrow more and spend more, but it is not willing to do so,’ he pointed out.
Mr Chidambaram said except for the modest MSME package, Congress is disappointed with today’s announcements.
Earlier on the day, Mr Chidambaram had mocked the Prime Minister’s announcement of a Rs 20 lakh crore special economic package and said it was like ‘headline and blank page’. ‘Looking towards the Finance Minister to fill the blank page,’ he had added.(uni)